TY - JOUR
AU - Elsby,Michael
AU - Hobijn,Bart
AU - Sahin,Aysegul
TI - Unemployment Dynamics in the OECD
JF - National Bureau of Economic Research Working Paper Series
VL - No. 14617
PY - 2008
Y2 - December 2008
DO - 10.3386/w14617
UR - http://www.nber.org/papers/w14617
L1 - http://www.nber.org/papers/w14617.pdf
N1 - Author contact info:
Michael W. Elsby
University of Edinburgh
School of Economics
31 Buccleuch Place
Edinburgh
EH8 9JT
United Kingdom
Tel: 011 44 131 650 8361
Fax: 011 44 131 650 4514
E-Mail: Mike.Elsby@ed.ac.uk
Bart Hobijn
Department of Economics
PO Box 879801
Tempe, AZ 85287-9801
Tel: 480-965-3531
Fax: 480-965-0748
E-Mail: bhobijn@asu.edu
Aysegul Sahin
Federal Reserve Bank of New York
Research & Statistics Group
33 Liberty Street
New York, NY 10045
Tel: 212-720-5145
E-Mail: Aysegul.Sahin@ny.frb.org
AB - We provide a set of comparable estimates for the rates of inflow to and outflow from unemployment for fourteen OECD economies using publicly available data. We then devise a method to decompose changes in unemployment into contributions accounted for by changes in inflow and outflow rates for cases where unemployment deviates from its flow steady state, as it does in many countries. Our decomposition reveals that fluctuations in both inflow and outflow rates contribute substantially to unemployment variation within countries. For Anglo-Saxon economies we find approximately a 20:80 inflow/outflow split to unemployment variation, while for Continental European countries, we observe much closer to a 50:50 split. Using the estimated flow rates we compute gross worker flows into and out of unemployment. In all economies we observe that increases in inflows lead increases in unemployment, whereas outflows lag a ramp up in unemployment.
ER -